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Chapter DT19860

Cited in Related
Vincent
Published date20 May 2016
Record NumberDT19860

Where the claimant is a United States citizen and the ‘eleven month rule’ described in DT19859 is not satisfied, it is necessary to establish, as a separate matter, whether he is also a ‘resident of the United States’ by reference to US domestic law. Section 7701(b) of the US Tax Code determines residence in the United States for ‘aliens’ (that is non-US citizens).

Generally there is no need in the US to determine the residence status of citizens because citizens are taxable in the US on their world-wide income regardless of residence status. In the absence of clear rules for citizens, accountancy firms usually apply the tests in Section 7701(b) to clients who are US citizens to decide whether they are US resident or not. The terms of the test are set out below and if the US citizen passes the test for the period of the treaty claim then it may be accepted that he is a resident of the US.

If the US citizen is also resident in the UK during the period, see DT19862 below.

Section 7701(b)(3) contains a ‘substantial presence’ test which considers how frequently an individual is physically present in the US. To pass this test:

the claimant must be present in the US on at least 31 days in the calendar year under test; and

the sum total of days present in the US in the year under test and the two preceding calendar years must add up to at least 183 days. For the purposes of this calculation, a day spent in the US in the year of test counts as a whole day, a day...

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